AMENDMENT NO. 5 TO THE
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of January 16, 2001
AMENDMENT NO. 5 (this "Amendment") to the Credit Agreement (as
defined herein) among Quality Stores, Inc., a Delaware corporation (formerly
known as "Central Tractor Farm & Country, Inc.") (the "Borrower"), QSI Holdings,
Inc., a Delaware corporation (formerly known as "CT Holding, Inc.") ("Holding"),
certain of the banks, financial institutions and other institutional lenders
listed on the signature pages hereof the "Lenders"), and Fleet National Bank
("Fleet"), as administrative agent (the "Administrative Agent") for the Lender
Parties (as defined in the Credit Agreement).
PRELIMINARY STATEMENTS
(1) The Borrower, Holding, the Initial Lenders, the Initial Issuing
Bank, the Swing Line Bank and the Agents have entered into a Second Amended and
Restated Credit Agreement dated as of May 7, 1999, as amended by Amendment No. 1
dated as of March 31, 2000, Amendment No. 2 dated as of September 22, 2000,
Amendment No. 3 dated as of September 27, 2000 and Amendment No. 4 dated as of
December 4, 2000 (as so amended, the "Credit Agreement"). Capitalized terms
defined in the Credit Agreement and not otherwise defined in this Amendment are
used herein as therein defined.
(2) The Borrower has requested that the Lenders amend the "clean up"
requirement applicable to the Revolving Credit Advances as set forth in Section
5.04(d) of the Credit Agreement.
(3) The Lenders have agreed to amend the Credit Agreement as
hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and agreements contained herein, the parties hereto hereby
agree as follows:
SECTION 1. Amendment of the Credit Agreement. The Credit
Agreement is, upon the Effective Date (as hereinafter defined), hereby amended
as follows:
(a) Section 5.02(s) is hereby amended in full to read as
follows:
"(s) Equity and Management Fees. Through and until
February 28, 2001, make, or permit any of its
Subsidiaries to make, any cash payment of equity fees
or management fees (other than reasonable out of
pocket expenses) to the Equity Investors or other
persons, and thereafter make, or permit any of its
Subsidiaries to make, any cash payment of equity fees
or management fees (other than reasonable out of
pocket expenses) to the Equity Investors or other
persons while ever there shall exist a Default or an
Event of Default.".
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(b) Section 5.04(d) of the Credit Agreement is hereby amended
by deleting the lines:
Period Amount
------ ------
"January 12, 2001-January 15, 2001 $121,000,000
January 16, 2001-January 30, 2001 $96,000,000
January 31, 2001 $93,500,000"
and replacing them with the following:
Period Amount
------ ------
"January 12, 2001- February 16, 2001 $121,200,000
February 17, 2001 - February 28, 2001 $93,500,000"
(c) Section 5.04(e) of the Credit Agreement is amended by (1)
inserting the words "or period" after the word "dates" and the word
"date" where those words first occur in that Section and (2) deleting
the line:
Date Ratio
---- -----
January 31, 2001 0.87
and replacing it with the following:
Period Ratio
------ -----
January 15, 2001 - February 16, 2001 0.90
(d) Section 6.01 of the Credit Agreement is hereby amended by
adding immediately before the paragraph commencing "then" the following
subsection:
"(r) Holding shall have failed to receive (after the Effective
Date of Amendment No. 5) cash proceeds of at least $2,500,000 from the
sale of common stock or convertible preferred stock (not subject to
mandatory redemption) of Holding on or before February 16, 2001."
(e) Section 7.07 of the Credit Agreement is hereby amended by
(1) inserting after the word "leases" the words "and to meet with the
management of any of the Loan Parties," and (2) by inserting after the
word "therewith" the words ", or in connection with a meeting of the
steering committee,".
SECTION 2. Conditions of Effectiveness of this Amendment. This
Amendment shall become effective as of the date first above written on the
Business Day when, and only
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when, the following conditions shall have been satisfied (such date being, for
purposes hereof, the "Effective Date"):
(a) The Administrative Agent shall have received counterparts
of (i) this Amendment executed by the Borrower, Holding and the
Required Lenders or, as to any of the Lender Parties, advice
satisfactory to the Administrative Agent that such Lender Party has
executed this Amendment and (ii) the consent dated as of the date
hereof (a copy of which is attached hereto) (the "Consent", together
with this Amendment, the "Amendment Documents"), executed by each of
the Loan Parties.
(b) The Administrative Agent shall have received signed
originals of proper financing statements, to be filed on or before the
Effective Date under the Uniform Commercial Code of all jurisdictions
that the Administrative Agent may deem necessary or desirable in order
to perfect and protect the first priority liens and security interests
created under the Security Agreement, covering the Collateral described
in the Security Agreement, as supplemented.
(c) On the Effective Date (and giving effect thereto), (i) the
representations and warranties contained in each of the Loan Documents
(including, without limitation, in Section 3 of this Amendment) shall
be correct in all material respects as though made on and as of the
Effective Date (other than any such representations or warranties that,
by their terms, refer to a specific date other than the Effective Date,
in which case as of such specific date) and (ii) no event shall have
occurred and be continuing that would constitute a Default.
(d) The Administrative Agent shall have received a certificate
of the Chief Financial Officer of the Borrower confirming satisfaction
of the conditions specified in paragraph (c) above.
(e) The Administrative Agent shall have received from the
Borrower, on or before the Effective Date, an amendment fee equal to
$200,000 payable to those Lenders who sign this Amendment according to
the pro rata share of the Commitments of each such Lender.
(f) All of the reasonable accrued and unpaid fees and expenses
of counsel and accountants for the Administrative Agent shall have been
paid in full, including, without limitation, the fees and expenses of
FTI/▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, L.L.C. and Shearman & Sterling, provided that
following the payment of such fees and expenses the balance of the
retainer paid to Shearman & Sterling for application against future
fees and expenses shall be $75,000 and the balance of the retainer paid
to FTI/▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, L.L.C. for application against future fees and
expenses shall be $50,000.
(g) The Borrower shall have paid in full all of the reasonable
accrued and unpaid fees and expenses of (i) Fleet Retail Finance with
respect to the field examination
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conducted by them and (ii) Great American Group with respect to the
appraisal of inventory conducted by them.
The effectiveness of this Amendment is further conditioned upon the
accuracy of all of the factual matters described herein. This Amendment is
further subject to the provisions of Section 9.01 of the Credit Agreement.
SECTION 3. Representations and Warranties. Each of Holding and
the Borrower hereby represents and warrants as follows:
(a) The execution, delivery and performance by each Loan Party
of any of the Amendment Documents and Loan Documents to which it is a
party, as amended hereby, and the consummation of the transactions
contemplated hereby and thereby, are within such Loan Party's corporate
powers, have been duly authorized by all necessary corporate action,
and do not (i) contravene such Loan Party's charter or bylaws, (ii)
violate any law (including, without limitation, the Securities Exchange
Act of 1934), rule, regulation (including, without limitation,
Regulation X of the Board of Governors of the Federal Reserve System),
order, writ, judgment, injunction, decree, determination or award
applicable to such Loan Party, (iii) conflict with or result in the
breach of, or constitute a default under, any contract, loan agreement,
indenture (including without limitation the Indenture), mortgage, deed
of trust, lease or other instrument binding on or affecting any Loan
Party, any of its Subsidiaries or any of their properties other than as
specified in the Credit Agreement, or (iv) except for Liens created
under the Collateral Documents, as amended hereby, result in or require
the creation or imposition of any Lien upon or with respect to any of
the properties of any Loan Party or any of its Subsidiaries. No Loan
Party or any of its Subsidiaries is in violation of any such law, rule,
regulation, order, writ, judgment, injunction, decree, determination or
award or in breach of any such contract, loan agreement, indenture,
mortgage, deed of trust, lease or other instrument, the violation or
breach of which is reasonably expected to have a Material Adverse
Effect.
(b) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
or any other third party is required to be obtained by the Loan Parties
in connection with the execution and delivery, or performance by any
Loan Party of any of its obligations under, any Amendment Document to
which it is a party.
(c) Each Amendment Document has been duly executed and
delivered by each Loan Party party thereto, and is the legal, valid and
binding obligation of such Loan Party, enforceable against such Loan
Party in accordance with its terms except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or other laws
relating to or limiting creditors' rights or by equitable principles
generally.
(d) No Loan Party has an existing claim against any Lender
Party arising out of, relating to or in connection with the Loan
Documents.
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(e) No Loan Party is in breach of, or in default under, the 10
5/8 % Senior Notes due 2007 issued by the Borrower, any contract, loan
agreement, indenture, mortgage, deed of trust, lease or other
instrument, binding on or affecting any Loan Party, any of its
Subsidiaries or any of their properties, where the consequence of such
default is to confer rights upon any person against the Borrower or any
of its Subsidiaries which, if exercised, can be reasonably expected to
have a Material Adverse Effect.
SECTION 4. Waiver and Release. The Borrower and Holding hereby
waive and agree not to assert any claims or causes of action against the
Administrative Agent, the Syndication Agent, the Documentation Agent, any Lender
Party or any of their Affiliates, or any of their respective officers,
directors, employees, attorneys and agents, on any theory of liability, whether
known or unknown, matured or contingent, including, without limitation, for
special, indirect, consequential or punitive damages, in each case to the extent
arising on or before the date hereof, out of or otherwise relating to, or in
connection with, the Amendment Documents, the Facilities, the actual or proposed
use of the proceeds of the Advances or the Letters of Credit, the Loan Documents
or any of the transactions entered into in connection therewith.
SECTION 5. Reference to and Effect on the Loan Documents.
(a) On and after the Effective Date, each reference in the
Credit Agreement to "this Agreement", "hereunder", "hereof" or words of
like import referring to the Credit Agreement, and each reference in
the Notes and the other Loan Documents to "the Credit Agreement",
"thereunder", "thereof" or words of like import referring to the Credit
Agreement, shall mean and be a reference to the Credit Agreement, as
amended and otherwise modified hereby.
(b) The Credit Agreement, the Notes and each of the other Loan
Documents, except to the extent of the amendments and other
modifications specifically provided above, are and shall continue to be
in full force and effect and are hereby in all respects ratified and
confirmed. Without limiting the generality of the foregoing, the
Collateral Documents and all of the Collateral described therein do and
shall continue to secure the payment of all Obligations of the Loan
Parties under and in respect of the Loan Documents, as amended and
otherwise modified by this Amendment.
(c) The execution, delivery and effectiveness of this
Amendment shall not, except as expressly provided herein, operate as a
waiver of any right, power or remedy of any Lender Party or any Agent
under any of the Loan Documents, nor constitute a waiver of any
provision of any of the Loan Documents.
SECTION 6. Costs and Expenses. The Borrower hereby agrees to
pay, upon demand, all costs and expenses of the Administrative Agent (including,
without limitation, the reasonable fees and expenses of counsel and financial
advisors for the Administrative Agent) in connection with the preparation,
execution, delivery, administration, syndication, modification and amendment of
this Amendment and the other documents, instruments and agreements to be
delivered hereunder, all in accordance with the terms of Section 9.04 of the
Credit Agreement.
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SECTION 7. Execution in Counterparts. This Amendment may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Amendment by telecopier shall be effective as delivery of a manually executed
counterpart of this Amendment.
SECTION 8. Governing Law. This Amendment shall be governed by,
and construed in accordance with, the laws of the State of New York.
SECTION 9. Waiver of Jury Trial. Each of the Borrower, the
Subsidiary Guarantors, the Administrative Agent and the Lender Parties
irrevocably waives all right to trial by jury in any action, proceeding or
counterclaim (whether based on contract, tort or otherwise) arising out of or
relating to this Amendment or the actions of the Administrative Agent or any
Lender Party in the negotiation, administration, performance or enforcement
thereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
QUALITY STORES, INC. (FORMERLY KNOWN
AS CENTRAL TRACTOR FARM & COUNTRY, INC.)
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice-President, Finance
and Chief Financial Officer
QSI HOLDINGS, INC. (FORMERLY KNOWN AS
CT HOLDING, INC.)
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice-President, Finance
and Chief Financial Officer
FLEET NATIONAL BANK, as Administrative Agent
By: ______________________________________
Title:
LENDERS
BANK OF AMERICA, N.A.
By: ______________________________
Title:
▇▇▇▇▇ ▇▇▇ & ▇▇▇▇▇▇▇ CLO I LTD.,
By: ▇▇▇▇▇ ▇▇▇ & Farnham Incorporated
as Portfolio Manager
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Sr. Vice President & Portfolio
Manager
FIRST UNION NATIONAL BANK
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: SVP
U.S. BANK NATIONAL ASSOCIATION
By: /s/
Title: Senior Vice President
THE HUNTINGTON NATIONAL BANK
By: /s/
Title: SVP
▇▇▇▇▇▇ FINANCIAL, INCORPORATED
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
▇▇▇▇▇▇ TRUST AND SAVINGS BANK
By: ______________________________________
Title:
COMERICA BANK
By: /s/
Title: Vice President
KEY CORPORATE CAPITAL
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
BHF (USA) CAPITAL CORPORATION
By: /s/ ▇▇▇▇ ▇▇▇▇
Title: Associate
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
UNION BANK OF CALIFORNIA, N.A.
By: /s/ J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
FIRSTAR BANK, NATIONAL ASSOCIATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
NATIONAL CITY BANK
By: ______________________________________
Title:
THE FUJI BANK, LIMITED
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President & Group
Head
STATE STREET BANK AND TRUST COMPANY,
as Trustee for GENERAL MOTORS EMPLOYEES
GLOBAL GROUP PENSION TRUST
By: ______________________________________
Title:
STATE STREET BANK AND TRUST COMPANY,
as Trustee for GENERAL MOTORS WELFARE
BENEFITS TRUST
By: ______________________________________
Title:
SEQUILS PILGRIM - I LTD.
By: Pilgrim Investments, Inc., as its
Investment Manager
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, CFA
Title: Vice President
PERSEUS CDO I, LIMITED
By: Massachusetts Mutual Life Insurance
Company as its Collateral Manager
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Managing Director
▇▇▇▇▇ ▇▇▇ FLOATING RATE LIMITED
LIABILITY COMPANY
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President
▇▇▇▇▇ ▇▇▇ & Farnham
Incorporated, as Advisor to the
▇▇▇▇▇ ▇▇▇ Floating Rate Limited
Liability Company
SAAR HOLDINGS CDO LIMITED
By: Massachusetts Mutual Life Insurance
Company as its Collateral Manager
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Managing Director
KZH CYPRESSTREE - 1 LLC
By: /s/ ▇▇▇▇▇ ▇▇▇
Title: Authorized Agent
ML CBO IV (CAYMAN) LTD.
By: Highland Capital Management, L.P.
as Collateral Manager
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Portfolio Manager
BALANCED HIGH YIELD FUND II, LTD.
By: BHF (USA) Capital Corporation, as its
attorney-in-fact
By: /s/ ▇▇▇▇ ▇▇▇▇
Title: Associate
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
CYPRESSTREE INSTITUTIONAL FUND, LLC
By: CypressTree Investment Management
Company, as Portfolio Manager
By: ______________________________________
Title:
NORTH AMERICAN SENIOR FLOATING RATE FUND
By: CypressTree Investment Management
Company, as Portfolio Manager
By: ______________________________________
Title:
SANKATY HIGH YIELD PARTNERS II, L.P.
By: /s/ ▇▇▇▇▇ ▇. Exeter
Title: Executive Vice President
Portfolio Manager
Sankaty Advisors, Inc. as Collateral Manager
for ▇▇▇▇▇ POINT CBO 1999-1, LTD., as Term
Lender
By: /s/ ▇▇▇▇▇ ▇. Exeter
Title: Executive Vice President
Portfolio Manager
Sankaty Advisors, Inc. as Collateral Manager
for ▇▇▇▇▇ POINT II CBO 2000-1, LTD., as Term
Lender
By: /s/ ▇▇▇▇▇ ▇. Exeter
Title: Executive Vice President
Portfolio Manager
Sankaty Advisors, Inc. as Collateral Manager
for GREAT POINT CLO 1999-1 LTD., as Term
Lender
By: /s/ ▇▇▇▇▇ ▇. Exeter
Title: Executive Vice President
Portfolio Manager
MONUMENT CAPITAL LTD., as Assignee
By: Alliance Capital Management L.P., as
Investment Manager
By: Alliance Capital Management Corporation,
as General Partner
By: /s/ Sverker M.M. Johansson
Title: Vice President
KZH WATERSIDE LLC
By: /s/ ▇▇▇▇▇ ▇▇▇
Title: Authorized Agent
ELC (CAYMAN) LTD. 1999-III
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: SVP
ELC (CAYMAN) LTD. 2000-I
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: SVP
PILGRIM CLO 1999-1 LTD.
By: Pilgrim Investments, Inc., as its
Investment Manager
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, CFA
Title: Vice President
GLENEAGLES TRADING LLC
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇
Title: Asst. Vice President
BANKERS TRUST COMPANY
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
FIFTH THIRD BANK
By: /s/
Title:
CONSENT
Reference is made to (a) Amendment No. 5 to the Second Amended
and Restated Credit Agreement dated as of May 7, 1999 as amended by Amendment
No. 1 dated as of March 31, 2000, Amendment No. 2 dated as of September 22,
2000, Amendment No. 3 dated as of September 27, 2000 and Amendment No. 4 dated
as of December 4, 2000 (as so amended, the "Credit Agreement") among Quality
Stores, Inc., a Delaware corporation (formerly known as "Central Tractor Farm &
Country, Inc.") (the "Borrower"), QSI Holdings, Inc., a Delaware corporation
(formerly known as "CT Holding, Inc.") ("Holding"), the banks, financial
institutions and other institutional lenders listed on the signature pages
thereof, and Fleet National Bank ("Fleet"), as administrative agent (the
"Administrative Agent") for the Lender Parties (as defined in the Credit
Agreement) and (b) the other Loan Documents referred to therein. Capitalized
terms defined in the Credit Agreement and not otherwise defined in this Consent
are used herein as therein defined.
Each of the undersigned, in its capacity as (a) a Grantor
under the Security Agreement, (b) a Pledgor under the Pledge Agreement, and/or
(c) a Subsidiary Guarantor under the Subsidiary Guaranty, as the case may be,
hereby consents to the execution and delivery of the Amendment and the
performance of the Amendment and agrees that:
(A) each of the Security Agreement, the Pledge Agreement and
the Subsidiary Guaranty to which it is a party is, and shall continue
to be, in full force and effect and is hereby in all respects ratified
and confirmed on the Effective Date, except that, on and after the
Effective Date, each reference to "the Credit Agreement", "thereunder",
"thereof", "therein" or words of like import referring to the Credit
Agreement shall mean and be a reference to the Credit Agreement, as
amended and otherwise modified by the Amendment; and
(B) as of the Effective Date, the Security Agreement and the
Pledge Agreement to which it is a party and all of the Collateral of
such Person described therein, and the Subsidiary Guaranty and the
guaranty provided thereunder, do, and shall continue to, secure the
payment of all of the Secured Obligations.
This Consent shall be governed by, and construed in accordance
with, the laws of the State of New York.
Delivery of an executed counterpart of a signature page of
this Consent by telecopier shall be effective as the delivery of a manually
executed counterpart of this Consent.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
QUALITY STORES, INC. (FORMERLY KNOWN
AS CENTRAL TRACTOR FARM & COUNTRY, INC.)
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice-President, Finance
and Chief Financial Officer
QSI HOLDINGS, INC. (FORMERLY KNOWN AS
CT HOLDING, INC.)
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice-President, Finance
and Chief Financial Officer
COUNTRY GENERAL, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice-President, Finance
and Chief Financial Officer
QUALITY FARM & FLEET, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice-President, Finance
and Chief Financial Officer
QUALITY INVESTMENTS, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice-President, Finance
and Chief Financial Officer
QSI TRANSPORTATION, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice-President, Finance
and Chief Financial Officer
VISION TRANSPORTATION, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice-President, Finance
and Chief Financial Officer
QUALITY STORES SERVICES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice-President, Finance
and Chief Financial Officer
